The objective of this article is to critically examine a school reform effort that has taken hold in New York City over the past seven years. A largely privately funded venture, the New Century Schools Initiative (NCSI), opened hundreds of new small high schools in poor urban communities in New York City starting in 2002. The theory behind opening small schools on a such a large scale has come from market principles of competition and consumer choice. By flooding the market with hundreds of schools, competition for students would, in turn, drive up the quality of the schools. Although support appears to be ubiquitous for the market-based reforms in New York City, this article argues that we need to look critically at reforms like NCSI, especially with the recent failure of market-driven policies to deliver on their promises. Using neoliberalism as a conceptual framework, this article asks two main questions: (a) How do neoliberal school reform policies play out in individual schools? and (b) To what extent do neoliberal policies contribute or detract from educational equity? (Contains 13 notes.)